Tuesday, 5 March 2024

Supermarket prices

Sam HIBBINS (Prahran) (19:13): (557) My adjournment is for the Minister for Planning, and the action I seek is for the minister to investigate anti-competitive behaviour by the supermarket duopoly Woolworths and Coles, including land banking tactics, and whether state planning laws are restricting competition in the supermarket industry, which ultimately results in higher prices for consumers at the check-out. People continue to struggle with the cost of living and the ever-rising cost of groceries and essential items, leaving many unable to put food on the table. With almost 70 per cent of market share, Coles and Woolworths are dominating the supermarket retail industry, allowing them to basically set the prices as high as they like. They are posting billions of dollars of profit while everyday Victorians are struggling to feed their families. Their market share and their profit margins are much higher than overseas counterparts. Greater competition would force the supermarket duopoly to offer more competitive prices, but experts are highlighting practices that the duopoly use to prevent would-be competitors from entering the supermarket industry here in Victoria and across Australia.

One of these barriers is the practice of land banking, a strategy used to reduce competition by hoarding land, where the supermarkets purchase large strategic areas of land even if they do not have plans or permission to build a supermarket there, to purposely exclude and deter would-be competitors from entering the market.

The supermarket duopoly also have advantages over smaller or would-be competitors when it comes to planning laws. Those advantages include planning regulations favouring established companies, financial position and brand recognition, reinforcing the duopoly that Coles and Woolworths have. They have been able to maintain their dominance over the supermarket industry by exploiting anti-competitive planning regulations that prevent competition from emerging retailers. This has resulted in consumers having no choice but to cop unfair price hikes at the check-out and suppliers having to accept lower costs for their products while Coles and Woolworths post those billion-dollar profits. The government has a responsibility to ensure Victorians are not being ripped off, so I call on the minister to investigate and put in place measures to prevent anti-competitive behaviour by the big two supermarkets.